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Ed Driscoll

You Didn’t Build That—Or File a Schedule C Afterwards

March 23rd, 2014 - 4:24 pm

“The current administration has suffered from a historic lack of private-sector experience, from Obama on down. There’s almost no one on the White House payroll who’s actually ever had to meet a payroll,” Ed Carson of Investor’s Business Daily wrote in 2010. Similarly, it seems safe to guesstimate that comparatively few journalists on the left have been self-employed in other professions before entering their current field. That can lead to confusion as to how small business and taxation works.

Or as Twitter user Chuck Peters writes today, “So basically Obama & Huff were geared up to make fun of Matt Drudge & then they realized they were wrong halfway through their propaganda.”

On Friday, Matthew Boyle wrote at Big Government, a section of the sprawling Website founded by the late Andrew Breitbart, who began his career in journalism as an associate of Drudge, “‘Liberty Tax’: White House, Media Attack After Drudge Pays Obamacare Opt-Out Penalty”:

A White House aide set off a stampede of liberal media criticism for Internet news pioneer Matt Drudge over Obamacare – but his critics don’t seem to understand how small businesses pay taxes.

The brouhaha started when Drudge tweeted, “Just paid the Obamacare penalty for not ‘getting covered’… I’M CALLING IT A LIBERTY TAX.”

Jesse Lee, the Director of Progressive Media at Barack Obama’s White House, responded that that was a “Flat lie, no fee for previous year,” adding, “Scary how much influence he once had.”

Lee’s response to Drudge set off a firestorm in the liberal media, with many mainstream media and left-wing reporters countering him on Twitter and in their own articles to claim he does not have to pay Obamacare’s Individual Mandate tax until next year. The individual mandate went into effect Jan. 1 of this year, and most people paying their taxes right now are paying taxes for 2013.

“Dude, there’s no penalty until next yr,” Sahil Kapur of the leftwing Talking Points Memo tweeted.

Kapur’s colleague at TPM Dylan Scott wrote a full story with a headline alleging Drudge was “probably lying.”

Welcome to the world of quarterly payments for the 1040 Schedule C Self-Employment Tax. At the Washington Times, Kellan Howell writes, “Media wrongly attack Drudge after he admits paying Obamacare penalty”:

A similar story appeared in Huffington Post, in which the author, Jeffrey Young, wrote Mr. Drudge’s tweet was “weird” and a “little head-scratching.”

What each critical tweeter and pundit failed to realize was that Mr. Drudge, as the self-employed proprietor of The Drudge Report, files taxes as a small business on a quarterly basis.

The IRS requires self-employed business owners to file annual returns and pay estimated quarterly taxes. When entrepreneurs like Mr. Drudge file their 2014 first quarter taxes, they have to pay the individual health care mandate if they are not getting Obamacare coverage.

The IRS form also allows adding the mandate to the section labeled “other taxes,” hence Mr. Drudge’s chosen name “Liberty tax.”

A Senate Budget Committee aide told Breitbart News, “It is true that thousands of small businesses will be forces to pay Obamacare taxes quarterly in 2014.”

Breitbart reported that Mr. Drudge did respond to the ill-informed critics, tweeting, “Dazed team Obama media reporters think Opt-Out tax ‘year-away’? Not for small businesses that file Qtr estimates. We’re there NOW, baby #pay.”

“Hey, WH, libs and lapdogs! Matt Drudge: This IRS form recommends paying ‘Obamacare tax NOW,” Twitchy notes, adding, “Looky here”:

drudge_obamacare_self_employment_tax_3-23-14

As with many on the left, Barack Obama has demonstrated his loathing of self-employment and entrepreneurship with his infamous “You didn’t build that” Kinsley-esque gaffe in the summer of 2012. In late October of last year, Democrat Jennifer Granholm lamely quipped on Meet the Press that Obama was so mad over the botched Obamacare rollout that “he himself would go down and supervise the writing of code if this is not fixed by the end of November.” Other than Granholm perhaps, no one expects the president to be writing his own computer code, but one would have expected his acolytes to have some idea of how the tax code worked. (When it’s not being used as a weapon against the president’s enemies, that is.)

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Top Rated Comments   
The ACA was passed so they could see what was in it. Four years later and they still don't know what was in it.
23 weeks ago
23 weeks ago Link To Comment
Drudge's leftists critics didn't know about the tax rules for sole proprietors. Not a big failing. Their big and interesting failure is that their first and then written reaction to Drudge's announcement was not curiosity. They didn't think "how can that be?". They didn't ask Drudge what was going on.

They called him a liar, although he supposedly lied about a simple and easily verifiable fact. A thoughtful person does not see every puzzling statement or new bit of uncomfortable data as a lie first off.

I think lefties get that way because they do it themselves. They see themselves as chosen guides to the future. Some have written that lying to achieve a suppposesdly good result is acceptable in political struggle. When they see a puzzling fact, they see it as merely the other side also lying to get its way.

They don't know what is true, after a while. They can't believe or absorb new information. They are much more attracted to making it up.

EasyOpinions.blogspot.com
23 weeks ago
23 weeks ago Link To Comment
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my roomate's sister makes $82 /hr on the laptop . She has been fired from work for five months but last month her pay was $13877 just working on the laptop for a few hours.
official website
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22 weeks ago
22 weeks ago Link To Comment
Unfortunately, 90% of Americans have no clue how much they are actually paying in taxes, let alone how the tax code works. Those of us who are self-employed, those of us who WRITE those quarterly checks out, pay for our own medical insurance, pay the FULL fica, rather than only half, as employees do, we know what government steals from us.
The payroll withholding was a brilliant move on the part of the Feds. People never even see the money in the first place. Americans have become so lazy about taking care of their own business as a result, that most of them now welcome government's 'benevolent' oversight of every aspect of life. And that payroll tax was the beginning of it all.
22 weeks ago
22 weeks ago Link To Comment
Seriously, if you haven't had to deal with or try to understand some of the these arcane tax rules and provisions, you just cannot understand how ridiculous the situation is. The politicians who allow this to continue (or worse, keep adding to it) are either willfully diabolical or totally ignorant. Try dealing with "non-operating losses carry forward" sometime. Even TurboTax, last time I looked, couldn't write code that can manage this in their on-line service. For many it is two weeks every year consumed with worry and non-productive work - just so you can allow these arrogant spendthrift politicians to control our behavior and maintain their flow of donations from those favored in the tax code. The amount of work and fees we pay for tax compliance is approaching a half trillion dollars. Next time a politician claims to want to help the economy - tell them you know a simple way to free up the 3% annually that is currently about doing completely unproductive work.
22 weeks ago
22 weeks ago Link To Comment
It is very likely that this crack staff expects everyone to be on the Timmy Geitner tax plan....
22 weeks ago
22 weeks ago Link To Comment
early this morning the resident wash. obamabots and their enablers (msm) were all over Matt. I checked later in the day and they were explaining (rotating at&t news art.) about different shades of truth, and how maybe Matt was somewhat correct. later tonight it has all but disappeared from the msm talking points, as Matt is proven right in what he said.

I even read where one of the lefty losers wrote it was amazing how much power one so lame once wielded (paraphrased).

trying to discredit a high profile reporter by low info. amateurs has backfired and given Matt Drudge a big fat present - even more publicity. pointing out their progressive stupidity at this stage is like pointing out that the sun is coming up every morning. everybody can clearly see it but the blind.
22 weeks ago
22 weeks ago Link To Comment
Nevermind business rules, every single EMPLOYEE is responsible for their W4 which is used to estimate tax withholding by their employer on their behalf. Are these people so clueless that they do not know that they are just as responsible for paying taxes in the *current year* and just as liable for penalties if their withholding rates yield a too low result? Don't they realize that they are responsible for adjusting withholding or sending in estimated taxes separately if their projected total tax amount exceeds the collection rates?

Okay, maybe they are entirely silly and haven't paid attention and haven't gotten a penalty ever because they are withholding far too much, but could they even figure out that this must be the case for the resulting tax refund? Don't they realize that the "tax refunds" are only there due to overcollection of taxes (by withholding or W4 or IRS-based redistribution) in the *previous year*?

They can't possibily think that they are receiving a "refund" in advance of payment, so they ought be be able to 2+2 their way into figuring out that 2014 taxes -- including Obamacare penalty taxes -- are due and expected to be paid throughout the year.
22 weeks ago
22 weeks ago Link To Comment
This was my thought as I read the article. They don't seem to realize that they to are paying the Liberty Tax via their withholding taken out every payday. That April 15 is the date when you have sent in the reconciliation of taxes owed to taxes paid and are refunded or must pay the difference. That you can get an extension on the reconciliation but if you've not had enough withholding to cover the taxes, you get penalties and interest for the deficit.

And I do think that far to many of these "betters" in government think that when they get their "tax refund" that they are getting free money from the government rather than their money that was overpaid back, i.e., a refund.

They are graduates of your most famous universities and have been conditioned to their station in life, employee. Wage slave, working for the Man, corporate drone, is all they know, all they can comprehend. College credentials, the most important badge in the cube dweller's realm. Knowledge, the most powerful tool in the owner's arsenal. Guess which the Left rate higher, credentials or actual knowledge and ability?
22 weeks ago
22 weeks ago Link To Comment
When I read that quote from Granholm about Obama personally supervising the coding of the exchange website, I had to laugh. Shades of Jimmy Carter personally supervising the sign-ups to use the White House tennis court.

I bet if Obama did get to the down and dirty of web development, the first thing he would do is take a two-week vacation somewhere before jumping into the guts of healthcare.gov.
22 weeks ago
22 weeks ago Link To Comment
The left used to have ideas. Now all they have is anger and hate.
23 weeks ago
23 weeks ago Link To Comment
amazing that once more liberals put their foot in mouth, because they once more forget to use brain.

Seems a liberal malady called foot in mouth syndrome.
23 weeks ago
23 weeks ago Link To Comment
Or as Twitter user Chuck Peters writes today, “So basically Obama & Huff were geared up to make fun of Matt Drudge & then they realized they were wrong halfway through their propaganda.”
------------------------------------------------------

I don't believe it! It is a seldom experienced phenomena that progressives have an epiphany of any kind - much less one that causes them to believe they were wrong!

DANG!!! Who'd a thunk it?


23 weeks ago
23 weeks ago Link To Comment
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